We maintain our negative outlook for the Brazilian consumer electronics segment in 2016 as we forecast this to be the final year of market contraction before returning to growth trajectory from 2017 onwards. Brazilian consumer electronics spending declined sharply in 2015 due to recession and depreciation, with a double-digit decline even in local currency terms. Spending is forecast to contract again in 2016 as recession and further depreciation erode purchasing power, but conditions are expected to be slightly less hostile than in 2015. Under our core scenario, the market is however forecast to return to growth from 2017, as wider economic sentiment improves with an added boost from currency appreciation, which we believe will unlock deferred purchases from 2015 and 2016. The improvement will be most pronounced in the PC and AV markets where demand was worst affected by economic conditions but it will still be handset sales growth that outperforms 2016-2020 as a result of the underlying strength of the smartphone upgrade trend.
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Computer Hardware Sales: USD8.8bn in 2016 to USD14.6bn in 2020. After a sharp contraction in demand in 2015 and 2016 the market will recover over the medium term as household purchasing power increases, and boosted by deferred purchases as confidence returns.
AV Sales: USD5.4bn in 2016 to USD7.3bn in 2020. Deferred purchases will be unlocked from 2017, but greater TV set saturation and cannibalisation of digital camera volumes will mean growth underperforms the computer hardware segment.
Mobile Handset Sales: USD12.2bn in 2016 to USD16.1bn in 2020. Only segment expected to register local currency growth in 2016, but market will cool over the medium term due to smartphone market saturation.
TABLE OF CONTENTS
BMI Industry View Latest Updates & Industry Developments SWOT Consumer Electronics Market Industry Forecast Latest Updates Structural Trends Table: Consumer Electronics Overview (Brazil 2014-2020) Industry Risk Reward Index Table: CE RRI Regional Scores Breakdown, Q216 Table: Americas Risk/Rewards Index, Q2 2016 Market Overview Recent Developments Computers Table: PC Sales (Brazil 2014-2020) Table: Brazil Consumer Electronics Tax Regime AV Table: AV Sales (Brazil 2014-2020) Table: Household Penetration Of AV Devices And Services (%) Handsets Table: Mobile Communications (Brazil 2014-2020) Regulatory Development Table: Government Authorities Table: PC And Handsets Tax Regime Competitive Landscape International Companies Table: Hewlett-Packard (HP) Table: Lenovo Local Companies Table: IGB Eletronica (Gradiente) Table: Itautec Demographic Forecast Table: Population Headline Indicators (Brazil 1990-2025) Table: Key Population Ratios (Brazil 1990-2025) Table: Urban/Rural Population & Life Expectancy (Brazil 1990-2025) Table: Population By Age Group (Brazil 1990-2025) Table: Population By Age Group % (Brazil 1990-2025) Methodology Industry Forecast Methodology Sector-Specific Methodology Sources Risk/Reward Index Methodology Sector-Specific Methodology Table: Consumer Electronics Risk/Reward Index Indicators Table: Weighting Of Indicators